U.S. Navy Receives New Biorefinery for Practically Nothing

The California-based company Biodico has announced that it will build a new biorefinery at Naval Base Ventura County, with the goal of producing biofuel for the Navy that costs no more than petroleum products. The Navy isn’t paying for the refinery, though. The innovative facility was developed with the support of grants from the California Energy Commission, and it will be constructed with private-sector financing.

That sounds reasonable enough but this isn’t just any biofuel project. It represents a strategy by the Obama Administration to keep biofuel flowing to the Navy, despite opposition from Republican leaders Congress who have been trying to block the Navy’ ambitious biofuel initiatives. So, don’t be surprised if some political fireworks break out before the new plant breaks ground.

A long history of federal biofuel research

The political pushback erupted this year, but biofuels were not always the focus of contention. Biofuel research has traditionally enjoyed esteem across both Republican and Democratic administrations. President Bush actually stepped up the federal government’s role in developing commercial biofuels, and his administration left a blueprint for future progress by issuing the 2008 National Biofuels Action Plan.

Biodico’s relationship with the Navy also dates back to the Bush Administration, under an initial agreement signed in 2002 covering biofuel research and development.

Biodico and Navy biofuel

In announcing the new agreement, JJ Rothgery, Biodico’s Chairman of the Board, said:

“Our objective is to privately fund sustainable biorefineries at DoD facilities around the world at no cost to the U.S. taxpayer, and to eliminate our dependence on foreign oil.”

Under the agreement, Biodico will build the new biorefinery and also conduct R&D into a wide range of biorefinery technologies, including transforming gases to liquids.

The new agreement also covers developing the use of non-food feedstocks, and developing useful byproducts from the refinery process.

How the Navy is getting low-cost biofuel

Though the cost of biofuel puchased by the Navy has been dropping rapidly, the ostensible reason for objecting to the Navy’s biofuel program has still been the cost relative to conventional fuel.

Biodico’s new plant at Ventura is expected to address this issue head-on by producing biofuels priced at or less than the cost of conventional fuels. It does this by treating fuel not as a stand-alone final product, but as just one part of a process that includes other valuable co-products and by-products.

Part of the company’s confidence is based on the high efficiency of the refining process itself. Called ARIES for Automated, Real-Time, Remote Integrated Energy System, Biodico’s fully integrated, remote-controlled system is designed to draw from sustainable, local feedstocks.

Another part of the cost-cutting derives from the California Energy Commission Grant, which was aimed at making the operation self-sustainable in terms of energy consumption. Incorporated into a microgrid, ARIES can also provide excess power back to other operations on the site.

Aside from the use of co-products (heat and energy) on site, the biorefinery process can also yield useful byproducts. Whether used on site or sold into commercial markets, this further offsets the cost of the biofuel products.

Why the Navy is getting its own biorefinery

ARIES is also fully modular and shippable, and that leads to the national security goals behind the Navy’s biofuel program.

Fuel diversification is a critical national security issue for the Navy and the Department of Defense as a whole. Aside from climate change and other environmental issues, in recent years petroleum dependency has lead to international entanglements, thousands of troop casualties related to fuel transportation, logistical complications, and price spikes that ripple out to affect the budget for training and other key operations.

Aside from helping to kickstart expansion of the U.S. biofuel market, the Navy has already started to forge a network of domestic-foreign affiliations that will help it to gain access to biofuel supplies in key regions overseas, among traditional allies such as Australia.

Modular and shippable biorefineries like ARIES will step that up another notch by making it easier for the Navy and other branches of the Armed Services to have biorefineries installed within the boundaries of their own bases, both in the U.S. and overseas.

Clean power leadership by the U.S. military

The Navy’s biofuel collaboration with Biodico is just one example of the Obama Administration’s support for military energy projects that leverage private-sector funding. Last year, the Army launched a new office called the Energy Initiatives Task Force, designed to streamline public-private collaborations on new utility-scale solar power plants and other clean energy sources at Army bases throughout the U.S.

The Department of Defense stepped it up to the next level last August, by signing an agreement with the Department of the Interior to investigate military properties throughout the western U.S. for clean energy production.

As with Biodico’s ARIES, these power plants will require no up-front costs. The Department of Defense will provide the land, and it will buy low-cost electricity from the new plants under power purchase agreements.

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Nice propaganda piece above, but not a critical assessment of where biofuels stand or of what value they are to the Navy or the nation. Google “ethanol bankruptcy” to see how the bio-refinery business is going for the most government-favored and subsidized biofuel. After recieving $6B a year since 2005 in subsidies and having a guaranteed market courtesy of the EPA, corn ethanol is still 40 cents more a gallon than premium gasoline on an energy content (MPG-corrected) basis. Now imagine what KiOR and Solazyme and others with far lower yield processes than corn ethanol face when trying to convince their investors that profits are only just several years away, and please keep sending more cash. Biofuels are attempts at perpetual motion in chemistry: turning hydrocarbons into carbohydrates back into hydrocarbons. The artificial ammonia fertilizer and pesticides and herbicides and farm equipment fuel and bio-refinery processing energy and transportation fuel and hydrogen to hydrotreat the final product into the “drop-in” fuels required by the military and airlines all come from natural gas and petroleum. Even the designer enzymes used in the most advanced processes are made from organic compounds synthesized from petroleum feedstock. When all is said and done, the best of biofuels take 8:1 EROI petroleum energy and reduce the return to 2:1 EROI and deliver it in inferior form as bio-alcohol or biodiesel or DDGS. Hydrotreatment to make the product back into something compatible with the gas turbine engines of the Navy and the airlines drops the EROI well below 1:1. Better to use petroleum directly as fuel and get the 8:1 return than accelerate its use making energy-sink biofuels, and thereby also increasing lifecycle GHG emissions, environmental damage, and dependence on foreign oil. The Navy would be better off buying horses and bayonets than biofuels.

http://www.jlmenergyinc.com/ GeorgeS

As a former member of the military and current employee of a renewable energy company, I am glad the military is moving forward with renewable energy projects. It’s good for our environment as well as our troop safety. Eliminating the supply lines of fossil fuels will keep our troops safer.

http://www.facebook.com/tesla444 Bob Little

Nice Oil Industry/Republican Spin, Cliff! If you want to stop the green industry loan guarantees you must also agree to stop the oil industry direct subsidies and loan guarantees? Yes?

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